Spotify Seeking An End To Apple Music's "Anti-Competition" Practices

Spotify Seeking An End To Apple Music's

The Spotify CEO said that ignoring Apple's payment system could cause serious damages to their communication with customers.

Apple should be probed by the European Union's antitrust agency over how it allegedly squeezes rival music streaming services, Spotify Technology SA said, escalating a debate over how Apple takes a cut of sales on its App Store.

It's why, after careful consideration, Spotify has filed a complaint against Apple with the European Commission (EC), the regulatory body responsible for keeping competition fair and nondiscriminatory.

Spotify wants Europe's competition watchdog to examine Apple for the way it runs the App Store. "Apple, you've got to break it apart from their App Store".

Apple's 30% "tax" on all app store purchases forces developers to hike subscription prices - making Apple Music look a bit more shiny and delicious to consumers - or eat the loss.

Spotify argues that it has to raise prices, making it more expensive than Apple's own streaming service, Apple Music.

The primary issues here are the 30 percent cut that Apple takes from nearly every transaction that goes through its system, and the alleged preferential treatment that Apple gives to its first-party streaming option (and direct competitor to Spotify), Apple Music.

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But the obvious question is why Spotify isn't also going after Google, which also charges a levy for apps on its app store and has a music-streaming service. A growing number of software companies, including Netflix and the developers behind the popular video game Fortnite, are aiming to bypass app stores altogether, or minimize Apple's involvement in payments. For example, Siri can still not be used to control Spotify playlists.

"We aren't seeking special treatment", Ek explains.

"All of these actions by Apple make it untenable for us as a competitor, and for us as a player in the global competitive ecosystem, to stand by and not take action", said Mr Gutierrez.

"Apple requires that Spotify and other digital services pay a 30% tax on purchases made through Apple's payment system, including upgrading from our free to our premium service", said Daniel Ek, Spotify co-founder and chief executive, in a blog post.

The primary complaint from Spotify (NYSE:SPOT) is that this fee created an incentive for consumers to choose Apple Music based on convenience.

Consumers should have a real choice of payment systems and not be locked down or forced to use Apple's discriminatory tariffs. Instead, the company is asking for fair set of rules that apple to everyone on the App Store, including Apple itself.